Iran voices readiness to freeze oil out in case OPEC deal extended
By Kamila Aliyeva
Iran, the third largest oil producer within the Organization of the Petroleum Exporting Countries (OPEC), promises to freeze oil production at the current level of 3.8 million barrels per day in the second half of 2017, if a decision to extend the reduction agreement is made in May.
"If OPEC members stay committed to the agreement (on freezing output), Iran will produce 3.8 million BPD of oil in (the) second half of the current year," Iran’s Oil Minister Bijan Bijan Namdar Zanganeh was quoted as saying by state news agency IRNA.
The Organization of the Petroleum Exporting Countries (OPEC) agreed last November to cut output by 1.2 million bpd to 32.5 million bpd for the first six months of 2017, in addition to 558,000 bpd of cuts agreed to by independent producers such as Russia, Oman and Mexico.
Iran is one of the three members of OPEC, for which an exception to the general plan was made in the agreement on the reduction of production. Under the terms of the deal, Iran could increase production in the first half of 2017 within 90,000 barrels.
Earlier, the minister said that in March 2017, Iran could increase production to four million barrels per day.
Exporting of oil is the biggest occupation of Iran and country's primary source of foreign currency. Currently, Islamic Republic strives to increase oil exports in an attempt to regain lost share of the market due to the sanctions that were imposed in response to Iranian nuclear program.
Kuwait earlier urged the OPEC to extend output cuts beyond June, becoming the cartel's first member to call for more time to balance the global oil market as the effort that boosted prices initially on the curbs has faded.
U.S. inventories have climbed more than expected, causing prices to decline even as global producers cut their output, Kuwait’s Oil Minister Issam Almarzooq said, according to Bloomberg. Kuwait supports rolling over the oil cuts, though it’s too early for the Organization of Petroleum Exporting Countries to agree on an extension, he said.
According to a recent OPEC report, world oil supply fell by over one million barrels per day in January, averaging at 95.75 million barrels per day.
The rally stalled this year as U.S. output and supplies continued to grow. Brent crude, a global benchmark, has declined 9.6 percent this year.
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Kamila Aliyeva is AzerNews’ staff journalist, follow her on Twitter: @Kami_Aliyeva
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